Fragmenting Europe and final thoughts

Sunday: Mid day, Another Davos moment, the Airport Lounge

Many people are headed home through Zurich airport on Sunday at mid day. And we always run into friends there. It began with a conversation with Lord Rees, the new head of the Royal Society (the British equivalent of the AAAS) who has been looking to have a conversation with our friend John Holdren the new head of the AAAS, when along came John and they went off together. Prof. Victor Halberstadt, one of Europe’s leading business intellectuals walked over and joined me for a particularly interesting conversation. He wanted to challenge something I had said a year or so before; that political Europe would be internally absorbed in integrating all the new members of the EU for decades to come. He too said they would be internally absorbed but for a different reason. He sees Europe fragmenting, but not along nation state lines. Rather it is tearing itself apart along many seams, immigrant vs. native, religion, class, age, and culture. The European vision of the post WWII generation has been lost at the very time that the internal tensions are becoming ever greater and the bases for agreement ever weaker. He believes that most of the energy of these societies will be burned up in just holding their countries together. It will mean slower growth in Europe as interest groups buy each other off out of the state coffers and that economic adaptation will be very slow in coming.

Based on a further conversation at his home in Amsterdam, he also believes that at least one of the major fault-lines is likely to be the increasing role of religion in politics in Europe. This will not be about issues of religious values, e.g. abortion, gay rights, etc. as in the US. These are settled issues in Europe. It is more about the politics of identity and Victor sees parties like the German Christian Democrats becoming more Christian. It is another way of creating a unique sense of identity now that the European dream may be dying and the nation state has been semi-absorbed into the EU. It gives people something strong with which to identify. As before in European history, this is unlikely to have a happy outcome.

As always among the best things about Davos were the many meetings and conversations most of which could happen only there. Some of the meetings will lead, like the AIDS conversation, to more later and others are merely interesting and informative. There were new people like the President of the Islamic Society of the US, the Brazilian legislator and her husband the CEO of Head the sports equipment company and many old friends like, Jim Rodgers and Martin Wolf. There was the opportunity to meet many of the new and consequential start-ups, like YouTube, Facebook, Skype, etc. So the networking function of Davos worked well.

Looking back over the week it feels like there was little sense of urgency in the world. There was a lot of discussion of the big problems: climate change, water, trade, economic imbalances, the dollar, religious and ethnic conflicts, rising China and India, extreme poverty and many more. But in the background was a global economy that felt fairly robust and from a business perspective times are good and no big threats appear imminent. You might call the mood complacent. There were no obvious big surprises or unanticipated crises. The upside of that complacency was a sense that first of all the problems are well recognized and that we can even imagine how most, if not all can be addressed. There was, for example, a broad consensus that climate change was an urgent issue but the only real question was what was the mix of technological solutions.

I can’t help wonder, as a result, if we are not missing something. Will we return to Davos next year only to find a very different mood following unanticipated events? Could it be a dollar crisis? Even more surprising weather? A scientific development? A breakdown in a key country? I would be interested in your thoughts on what the Davosians might have missed.

Thanks for staying with me.